Back to the July 28 judgement

The mere globalization is instrumental in thrusting the tyranny of awareness on the people of Pakistan. Understanding the law is no exception. The decisions of the Supreme Court (SC) of Pakistan that remain sequestered from the public eye may not endure a debate; otherwise, the decisions such as the July 28 judgement can claim no immunity. Certainly, the judgement was replete with blunders.

On October 21, Federal Minister Daniyal Aziz held a press conference in Islamabad and reminded viewers of certain important points.

First, Aziz said that the definition of the word “assets” used by the SC was non-existent in the Black’s Law dictionary mentioned in the judgement. Similarly, the second dictionary, the Business Dictionary, existed only in the virtual world of internet and not in any printed form. Taken together, this means that the relevant bench of the SC used a fictitious definition and did not bother to consult these dictionaries in reality before writing the judgement, to ensure the authenticity of their decision. In no case can this act be considered an oversight in the judgement to be disregarded. Instead, this is an addition of another flaw to the long list of mistakes impugning the validity of the judgement.

Second, Aziz also said that “receivables, if not received, could not be classified automatically as assets”. Interestingly, how to deal with receivable encompasses both the areas of the income tax (or the wealth tax) law and the accounting rules. Receivables lie on their border. In fact, the SC could not discriminate between the concept of “assets” given in the accrual basis accounting of a company and that in the cash basis accounting of an individual such as an employee. Nevertheless, if the interpretation of the SC is accepted as correct, this point alone holds the potential of adversely affecting the prevalent income tax and accounts practices. Perhaps, both have to be revised to accommodate the July 28 judgement, if the judgement is not reviewed to meet the reality. Anyway, the implied message in this point of Aziz is that the government might be thinking of introducing an amendment to the Income Tax Ordinance 2001 in the light of the judgement to bring it in line with the judgement. Any such amendment is bound to invite an outcry from society and discomfiture for the SC.

Third, Aziz said that all nomination papers filed in 2013 for general election had to be vetted again in light of the July 28 judgement, as the SC could issue no judgement that could be person specific but that spared the rest of the country. In principle, by now, the Election Commission (EC) of Pakistan should have done the requisite screening of the papers of the candidates. There should be left no need on the part of anybody to challenge someone’s nomination papers springing the EC into action. Instead, the July 28 judgement carries an automatic execution force retrospectively, though any writ petition in a high court can prompt the ECP to do so. Interestingly, the July 28 judgment is also saying that the EC, which had been vested with defining “asset” and which had been doing so for years, failed to perform its desired function. In this way, the EC should be penalized for the same, as the judges sitting on its panel are thriving at the expense of public money.

The SC is in a quandary. The Black’s Law dictionary is known for its being the secondary legal authority for understanding legal briefs and opinions. In case of Pakistan, the Income Tax Ordinance 2001 was the first legal authority. Interestingly, through the July 28 judgement, the SC not only set a precedent for making the Black’s Law dictionary (i.e. the secondary legal authority) preferred to the Income Tax Ordinance 2001 (i.e. the primary legal authority), but the SC also relied upon the definition of the word “assets” not found in any edition of the Black’s Law dictionary. By not giving a justification for bypassing the Income Tax Ordinance, the SC made an arbitrary decision. This is precisely why people lose faith in the SC and question its objectivity and capability.

Attached to this point is another dimension of the issue. It is known that there is present no definition in the Representation of the People Act (ROPA) of 1976 and that the Act relies on the relevant primary legal authority for definitions. Interestingly, instead of keeping the ROPA subservient to the Income Tax Ordinance (i.e. the primary legal authority), the July 28 judgement made the ROPA deferential to the Black’s Law dictionary for finding definitions. The consequent direct relationship between the ROPA and the Black’s Law dictionary will have its own adverse effects. In fact, without any plausible justification, the Income Tax Ordinance was bypassed and the ROPA was made subservient to the Black’s Law dictionary. Per se, the bypassing of the Income Tax Ordinance begs not only revision of the whole ordinance but also readjustment of the accounting system in line with the parameters of taxation and accountancy set by the SC in the judgement.

The SC assumed that the mere presence of the Wage Protection System used by the Ministry of Labour in the United Arab Emirates and the Jebel Ali Free Zone was enough to verify the electronic payment of the salary to an employee, Nawaz Sharif. The attached assumption was that the electronic payment also meant electronic receipt. Interestingly, in its judgement, the SC failed to produce any such receipt or bank statement (or even a bank account) as an evidence or proof. The mere presence of rules does not mean the presence of proof. Similarly, the SC remained credulous to accept that the rules governing the Wage Protection System were inviolable. If the Wage Protection System meant the delivery of the salary in absolute terms, the SC has so far not explained the reason for the presence of penalties on the violation of rules. To voters, the situation indicates that the SC decided perfunctorily and sloppily about the fate of their elected representative, who happened to be the prime minister of the country. Secondly, when committed a mistake, the SC is not flexible to admit the mistake and rectify it.

Three points are now obvious. First, the SC had no expert knowledge on and understanding of the law related to taxation. Second, the SC opted advertently for not consulting income tax practitioners available with the SC as amici curiae. Third, the SC counted on assumptions. The SC is overlooking that fact that the attack boys and defence analysts in the media are incapable of defending SC’s July 28 judgement. Nor can they paper over the mistakes traducing the judgement. Intelligence agencies also offer no solution.

The respect of an institution does not forbid anyone from disagreeing with its decision and asking instead for a fair, sane judgement. The point is simple: the SC is not supreme to the law. The SC is subservient to the constitution and the judges are paid salaries from the public exchequer. Rights of people reign supreme. The constitution does not confer upon the SC to make arbitrary interpretation of law. The SC needs to satisfy people on its July 28 judgement, respecting their right to know and valuing the tyranny of their awareness.